UK Inflation Jumps to Eight-Month High Ahead of BOE Decision
UK inflation rose to an eight-month high in November, drifting further above the Bank of England’s 2% target and supporting expectations that it will hold interest rates at its final meeting of the year.
The consumer prices index increased 2.6% annually, up from 2.3% in October, the Office for National Statistics said on Wednesday, driven up by motor fuel prices. Economists had expected CPI to come in at 2.6%, while the BOE forecast 2.4%.
Services inflation — closely watched by BOE rate-setters for signs of lingering pressures — remained stubbornly high at 5%. The BOE had expected 4.9%.
The figures will reinforce fears of so-called “stagflation” — a high inflation, low growth scenario that threatens to cause a major headache for Prime Minister Keir Starmer, whose Labour government promised to boost living standards.
The BOE is expected to keep borrowing costs on hold at 4.75% on Thursday and ease at a cautious pace next year, with the UK facing inflationary risks both at home and from abroad.
Source : Bloomberg
